Portland Apartment Market Fundamentals Stumble
Portland's apartment market has historically been more stable than some other West Coast metros, but recent data shows a decline in fundamentals in 2023. Portland recorded net move-outs from 435 units in the year-ending 3rd quarter, while over 3,800 new units were concurrently delivered. This imbalance resulted in occupancy falling 140 basis points (bps) in the past year to 94.2%, one of the poorest showings in the Pacific Time Zone. As of September, new residents paid 1.5% less than the previous tenant for the same unit in Portland. That was down significantly from just a year ago, in 2022, when new renters were paying trade-out price increases of nearly 20%. Across Portland’s 11 submarkets, none posted rent growth in the last year, though two submarkets – Central Portland and Southwest Portland/Tigard – managed stagnant growth in the year-ending 3rd quarter. In the near term, the Portland apartment market is expected to see increased supply volumes, which may further impact the occupancy and rent change landscape. About 5,500 units are expected to come online in Portland in the next 12 months.
For more information on Portland and the rest of the West Coast region, including forecasts, watch the webcast Market Intelligence: Q4 West Coast Update.